Whole of Market Bridging Loans Broker

How Does a Bridging Loan Work?

Bridging Loans are generally considered a short term finance solution, traditionally used to bridge the gap between sale proceeds clearing and the purchase of a new property but now offer a short term solution in a number of situations including renovation/re-development, lease extension, funding a new business venture and divorce settlements amongst other situations.

The main difference between bridging loans and general loans is that there are no regular repayments to be made. A bridging loan is a short term secured loan where the funds and any interest charged are repaid in full at the end of the term. You will be required to have an ‘exit strategy’ in place where you can demonstrate how you intend to clear the repayment amount at the end of the term. Given the short term nature of a bridging loan, interest rates are higher than mainstream lending.

A specialist bridging loan company such as bridgingloans.co.uk, have, due to the volume we process, special relationships with all of the key lenders and know the requirements needed to ensure a quick and smooth transaction. We also use our own funds for certain lending, which helps us to move even quicker if required. Processing time is however normally 3 – 5 working days.

Due to our FCA regulated principle, we can transact all types of bridging loans on all types or property. This ensures that with just one call we can give the answers you require. We are not even limited by bridging loan size and currently have no minimum or maximums.

We pride ourselves on the speed of our transactions. We will normally call you within hours of an emailed application for a bridging loan and supply a written agreement shortly afterwards. If you call our office, this process will be even quicker. If you decide to progress with the application we can instruct the valuation and legal team immediately while the paperwork is being processed, thus saving valuable time. We would either post, email or visit you to obtain the required signatures and documentation, which is again done shortly after the initial contact and agreement to proceed. We don’t charge upfront fees, so it is in our interest to complete on every case as soon as possible.

We are available from 9-9, 7 days a week, including most holiday periods.

What Is A Bridging Loan?

Many people ask “What is a bridging loan?” A bridging loan is a loan used for a short term fix between the transaction of selling a property and buying another. An example of when a bridging loan could be used is for instance, when the property market is at a stage to buy.

Bridging loans can be used for many purposes and are not only limited to purchasing property. They have in the past been used for capital raising to pay tax bills or for numerous business reasons however the security for the loan must be UK property or land. Whether you need a commercial bridging loan or residential loan you will need similar criteria.

What Is Bridging Loan Security?

All bridging loans require security for the loan which is primarily in the form of property or land anywhere within the UK. The bridging loan lender will enter a charge onto the security at commencement of the loan. This will be removed when the loan is repaid. Any security must be in the name of the borrower.

What Is A Bridging Loan Term?

Most bridging loans are usually up to 12 months in length but can be extended in certain circumstances. Interest payable during the term of the loan is usually rolled up and repaid at the end when the loan is repaid i.e. if you borrow £100,000 and generate £5,000 of interest; £105,000 is repaid to the bridging lender, when you repay the loan.

As industry leading providers of bespoke finance solutions, the team at UK Property Finance can arrange tailor-made short term property lending facilities for all types of property development and refurbishment projects. Whether you are looking at a new build residential or commercial property loan, or taking on a refurbishment project, we will use our expertise to source the most appropriate funder for your short term property needs. If you simply need bridging finance solutions then we can provide that too.

Every property development loan is by definition different and we spend time to understand the key requirements of the deal before identifying the funder which best meets your requirements the cost of the loan is only one factor, we also look at the overall amount of the loan, availability of drawdowns, whether the lender can meet your deadlines etc. We also look at your experience in the market as this will be a large factor in determining which lender we recommend some providers of residential and commercial property loans require experience, some don’t but don’t worry, we will ensure we choose the right one and will be there with you throughout the process to ensure you get the loan drawdown.

We cover the whole of the market from the High Street banks through to specialist development funders. We have good knowledge of the requirements of each lender so whether you are looking for property refurbishment finance or housing development finance, our short term property finance team will be on hand to ensure that raising finance for property development is handled professionally and promptly so you get the funding you are looking for.

Bridging Loan Process – Simplified

It is our aim to provide expert bridging solutions without the confusion.

Here is a simplified version of the sequence of events you will go through when applying for bridging finance.

1) Basic Enquiry

We provide each of our prospective clients with free and impartial advice during an initial consultation over the phone where we will discuss your individual requirements, personal circumstances and the available options. As qualified bridging specialists, we will approve the decision to lend in principal there and then, whilst providing an accurate estimation of the borrowing costs.

2) Detailed quote and loan acceptance

It usually takes around an hour or two for us to source a suitable finance solution. Next, we will send you an email with a detailed quote once you have been accepted by one of our lenders.

3) Property valuation and legal works

If you decide to go ahead with the bridging loan offer, we will then need to instruct a valuation on the property you are using as collateral. Although this is not always necessary, the majority of lenders will require a valuation to be carried out.
Depending on the urgency of the situation, the necessary legal works can be carried out at the same time as the valuation although, in most instances, they can be dealt with nearer the time of the funds being issued.

4) Completion or Payout

Also known as Drawdown, once the loan is ready the funds can be released to the borrower either immediately or as soon as they are needed.

A Bridging Loan Can Be Used for Many Purposes

• Business Funds: short term working capital
• Auctions: purchasing bargain property quickly at auction
• Temporary Cash flow problems: when you require cash urgently
• Tax Liabilities: finance those unexpected tax bills
• Property Refurbishment: upgrade your residential or business premises
• Buy-to-let: don’t miss out on an investment opportunity
• Moving House: seen your ideal property but in a chain & need temporary funding to move quickly

No Bridge Too Far!

“The team at BridgingLoans.co.uk have demonstrated outstanding professionalism and market knowledge concerning commercial funding in what is a very difficult market. The diligence and integrity in all matters concerning my own business has been exemplary. They are first class communicators, ensuring that you are always up to date with the status of any transaction and proved capable of delivering on the finance required.”

Mr A Rutherford.
Royal Saint Davids Golf & Hotel Complex